The Hindu Business Line : Pvt firms top in PSU debt placements

THE pecking order of merchant bankers specialising in arranging debt placements by Government companies is changing quickly. SBI Capital Markets, which had not so long ago been near the very top, has occupied a relatively lower rank this time, while a string of private sector names coming up in terms of total mobilisation.

The latest who's who of arrangers — AK Capital, Allianz, UTI Bank, Darashaw and RR Financial, in that order — have between themselves cornered a sizeable portion of the market, according to figures collected by Prime Database. The sequence (for 2003-04) is somewhat different from what was recorded in the previous year. For the period ended March 2003, the top names in the field were AK Capital, SBI Caps, Centrum, Allianz and RR Financial.

Funds collected by public sector and State-level undertakings (PSUs and SLUs) through private placements happen to be a major indicator of the kind of merchant banking that takes place in the country, market sources said. SBI Caps has occupied only the sixth position this time, followed by the likes of Centrum, I-Sec, SPA and Kotak Mahindra. Incidentally, it was the sole arranger for four issues, which raised Rs 670 crore.

SBI Caps was the second-biggest player in the previous year, while UTI Bank (the latest No 3) was ranked seventh. RR Financial held the fifth position during both 2003-04 and 2002-03.

For AK Capital, this was a repeat performance, according to company sources. It played a role during 2003-04 with regard to debt issues worth Rs 6,324.18 crore, accounted for by 32 offerings in all. The company participated in a shade over 50 per cent of the floats in the PSU-SLU segment.

There were 62 cases of placements by PSUs and SLUs during the past fiscal, which led to a collection of Rs 12,445 crore - standing for about 26 per cent of the overall private placement volume of well over Rs 40,000 crore. In 2002-03 too, the company had been the No 1 player handling 36 issues (Rs 5,968 crore). The number of placements was significantly lower this year; the corresponding figure for 2002-03 was 473.

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